Magnolia to Sell Franchises Overseas

Date

Mar 11, 2013

By ANGUS LOTEN

Magnolia Bakery, the New York City purveyor of cupcakes once prized
by the gals on "Sex in the City"—and featured in the "Saturday
Night Live" video "Lazy Sunday"—received state approval this week
to sell franchises and
is eyeing overseas markets as diverse as Sao Paulo, Tokyo and Doha,
Qatar.

The new franchises will
only be sold abroad, according to the store's co-owner, Steve
Abrams. He says the bakery's vintage cakes and desserts are already
popular outside the U.S., thanks in no small part to Carrie
Bradshaw, the sex columnist portrayed by Sarah Jessica Parker on
the widely syndicated HBO series.

"The show resonated with people all over the world and that's been
great for us," says Mr. Abrams, who adds he has been approached by
thousands of budding franchisees over the years, ranging from
mom-and-pop tourists to chief executives of multinational
corporations.

The bakery has also made appearances in "The Devil Wears Prada,"
"Spin City," "Late Night with Conan O'Brien" and "Veronica
Mars."

Mr. Abrams says the bakery is largely perceived as a luxury brand
outside the U.S., especially in emerging markets in South America
and the Middle and Far East that now have a growing appetite for
high-end western luxury goods. The company is courting prospective
buyers in Hong Kong, India, Qatar, Kuwait and Brazil, among other
places, he says.

"The time is right," he says.

Meanwhile Abrams, along with his wife, Tyra, will continue to
oversee the four New York locations and an outlet in Los Angeles. A
location is currently being planned in Chicago, as well as in
Bloomingdale's flagship store in Manhattan. All of the U.S.
locations will be owned by Magnolia Operating LLC, the Abrams' New
York-based company. An online store is also in the works, which
will offer nationwide delivery.

Mr. Abrams says they've developed manuals, recipe books and other
training materials to ensure the international outlets offer as
close to the same experience as possible—though he also anticipates
some regional variations, such as a green tea cupcake at stores in
Japan.

The original Greenwich Village store opened in 1996. Owners Allysa
Torey and Jennifer Appel started out with just a handful of
employees, offering fresh bread and cinnamon rolls. They soon added
vanilla cake with pink-tinted buttercream-icing cupcakes, sparking
a craze among the neighborhood's late-night crowd. Four years
later, Ms. Appel left to start her own bakery, and in 2007 Ms.
Torey sold the store to the Abrams.

Today, cupcakes make up just 50% of the company's business, Mr.
Abrams says. The bakeries now produce some 60 different products
with 120 variations, including cakes and pies, banana pudding,
cookies, mini-cheesecakes and breakfast muffins.